TechnipFMC Awarded Large iEPCI™ Contract for Energean’s Katlan Development

Rhea-AI Summary

TechnipFMC (NYSE: FTI) has secured a large integrated Engineering, Procurement, Construction, and Installation (iEPCI™) contract from Energean for the Katlan development in the Mediterranean Sea. This project marks Energean's first use of TechnipFMC's configure-to-order Subsea 2.0® production systems. The contract, valued between $500 million and $1 billion, covers the design, manufacture, and installation of production systems, pipe, umbilicals, and subsea structures.

The subsea infrastructure will connect to the Energean Power floating production, storage, and offloading vessel (FPSO), which currently serves the Karish and Karish North developments. TechnipFMC's integrated approach, combining iFEED® for optimized field layout with Subsea 2.0® platform and iEPCI™ execution model, is expected to accelerate time to first production at Katlan.

Positive

• Large contract valued between $500 million and $1 billion
• First project using TechnipFMC's Subsea 2.0® production systems for Energean
• Integrated approach expected to accelerate time to first production
• Strengthens collaborative relationship with Energean

Negative

• None.

Insights

Financial Analyst

TechnipFMC's new contract with Energean is a significant development for the company, especially given the size of the contract, which ranges from $500 million to $1 billion. For a financial analyst, this contract enhances TechnipFMC's revenue visibility and backlog, contributing positively to the company's financial metrics. The use of TechnipFMC's Subsea 2.0® production systems and its integrated project execution model (iEPCI™) showcases the company’s competitive edge in delivering cost-effective and timely solutions. Such contracts often lead to economies of scale and better utilization of resources, which could improve company margins in the medium to long term. However, investors should remain cautious of execution risks and potential delays, which can impact project profitability. Revenue growth from such large-scale projects can positively influence quarterly earnings, making TechnipFMC more attractive in the short term.

Additionally, the inclusion of this contract in Q2 orders will likely be reflected in future earnings reports, potentially improving stock performance. The analyst should also monitor the company's overall debt levels and how this project impacts its financial leverage. Given the strategic importance of the Mediterranean energy market, this contract positions TechnipFMC favorably against competitors.

Market Research Analyst

From a market research perspective, the contract between TechnipFMC and Energean underscores the growing importance of integrated engineering solutions in the offshore energy sector. The use of the iFEED® and Subsea 2.0® platforms highlights a trend towards more streamlined and cost-efficient project executions. This partnership not only reinforces TechnipFMC’s market position but also signals a potential shift in industry standards for subsea infrastructure projects. Investors should note the strategic value of such collaborations, which can drive technological advancements and set new benchmarks in the industry.

The focus on the Mediterranean region, a key energy hub, suggests a broader trend towards exploiting underdeveloped offshore reserves. This geographical focus can lead to more regional contracts and establish a strong foothold for TechnipFMC. It’s also worth noting that the Mediterranean projects often come with geopolitical risks, which could affect operations. Monitoring regional stability and regulatory environment will be important for assessing the long-term impacts of this contract.

NEWCASTLE & HOUSTON--(BUSINESS WIRE)-- TechnipFMC (NYSE: FTI) (the “Company”) has been awarded a large⁽¹⁾ integrated Engineering, Procurement, Construction, and Installation (iEPCI™) contract by Energean for its Katlan development in the Mediterranean Sea.

This is Energean’s first project to use TechnipFMC’s configure-to-order Subsea 2.0^® production systems.

The award follows an integrated Front End Engineering and Design (iFEED^®) study by TechnipFMC, which optimized the commercial and technological solution for the field. The contract covers the design, manufacture, and installation of the production systems, pipe, umbilicals, and subsea structures.

The subsea infrastructure will tie back to the Energean Power floating production, storage, and offloading vessel (FPSO), which currently serves the Karish and Karish North developments. TechnipFMC also delivered fully integrated subsea solutions utilizing our iEPCI™ execution model for both of these developments.

Jonathan Landes, President, Subsea at TechnipFMC, commented: “Combining iFEED^® to optimize field layout with our Subsea 2.0^® platform and integrated project execution model accelerates the time to first production at Katlan. This is another iEPCI™ with Energean, demonstrating the collaborative relationship of our two companies which enables TechnipFMC to continue to deliver improved project economics.”

(1) For TechnipFMC, a “large” contract is between $500 million and $1 billion. This award was included in second quarter Subsea inbound orders.

Important Information for Investors and Securityholders

Forward-Looking Statement

This release contains "forward-looking statements" as defined in Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended. The words “expect,” “believe,” “estimated,” and other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. Such forward-looking statements involve significant risks, uncertainties and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections. For information regarding known material factors that could cause actual results to differ from projected results, including our assumptions and projections regarding the expected benefits of the awarded contract, please see our risk factors set forth in our filings with the United States Securities and Exchange Commission, which include our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. We caution you not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any of our forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except to the extent required by law.

About TechnipFMC

TechnipFMC is a leading technology provider to the traditional and new energy industries, delivering fully integrated projects, products, and services.

With our proprietary technologies and comprehensive solutions, we are transforming our clients’ project economics, helping them unlock new possibilities to develop energy resources while reducing carbon intensity and supporting their energy transition ambitions.

Organized in two business segments — Subsea and Surface Technologies — we will continue to advance the industry with our pioneering integrated ecosystems (such as iEPCI™, iFEED™ and iComplete™), technology leadership and digital innovation.

Each of our approximately 21,000 employees is driven by a commitment to our clients’ success, and a culture of strong execution, purposeful innovation, and challenging industry conventions.

TechnipFMC uses its website as a channel of distribution of material company information. To learn more about how we are driving change in the industry, go to www.TechnipFMC.com and follow us on X (formerly Twitter) @TechnipFMC.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240718225840/en/

Investor relations

Matt Seinsheimer

Senior Vice President, Investor Relations and Corporate Development

Tel: +1 281 260 3665

Email: Matt Seinsheimer

James Davis

Director, Investor Relations

Tel: +1 281 260 3665

Email: James Davis

Media relations

David Willis

Senior Manager, Public Relations

Tel: +44 7841 492988

Email: David Willis

Source: TechnipFMC plc

FAQ

What is the value of TechnipFMC's (FTI) contract for Energean's Katlan development?

TechnipFMC's contract for Energean's Katlan development is classified as 'large,' which means it is valued between $500 million and $1 billion.

What technologies is TechnipFMC (FTI) using for the Katlan development?

TechnipFMC is using its configure-to-order Subsea 2.0® production systems, iFEED® for field layout optimization, and iEPCI™ execution model for the Katlan development.

How will the Katlan development be connected to existing infrastructure?

The Katlan development's subsea infrastructure will tie back to the Energean Power floating production, storage, and offloading vessel (FPSO), which currently serves the Karish and Karish North developments.

What is the expected impact of TechnipFMC's (FTI) integrated approach on the Katlan project?

TechnipFMC's integrated approach is expected to accelerate the time to first production at the Katlan development.